Who Pays For What During The Homebuying ProcessNovember 8, 2019 3:30 pm
As a first-time homebuyer, you’re bound to ask yourself who pays for what fees or taxes as you see the list grow longer and longer. In an effort to demystify the process, we tapped our Suburbit expert, Holly Giordano, who gave us insight on how closing fees are broken down.
The more light she shed on closing costs, the more we realized that the bigger note to share in a piece like this was to underscore what buyers should be doing to set themselves up for the most success in the homebuying process. But if you want to see the breakdown of the numerous costs and fees, try a closing cost calculator such as this one. And don’t forget that there are other costs (such as home inspections) that may come up even before you are at the closing table.
Let sellers pay
According to Giordano many people who are looking to buy a home trip up by assuming that using a agent will cost them too much money and as a result research (and invest) in other avenues that they end up paying for out of pocket. Sellers typically front the cost for agents and absorbing those costs as a buyer is one mistake Giordano encourages others to avoid. In addition, according to Giordano, “4-6% fees of purchase price, an average of 5%, [are] paid by seller” not the buyer. So, while buyers will need to have a good chunk of change put away for their own closing costs, it’s as important for sellers to note that fees like real estate agent commissions and transfer taxes that will land at their foot.
Your agent should be your guiding light
Navigating homebuying can be incredibly tricky, which is why having an agent who both understands you and champions for you is incredibly important. Giordano encourages buyers to take stock on whether they feel comfortable enough to turn to their agents with uncomfortable questions about who pays for what — if the answer is yes then they are in the right hands. If their answer is no then Giordano encourages to spend time finding an agent that may be a better fit for them.
Make sure everyone is talking
One way to ensure that fees on the buyer’s side will be minimized as much as possible is to have a homebuying team that isn’t afraid to talk to each other. Making sure your real estate attorney, your mortgage person, and your real estate agent are all talking to each other about you and your needs is key, shares Giordano. These conversations make sure that your time is spent sifting through potential homes that may be the perfect fit for you and your budget, versus having to reexplain your needs to three separate people multiple times.
Staying grounded throughout the process means doing the right kind of homework. In the case of fees, it also means having the right conversations with the right people. Our network of agents are ready to serve and answer all your questions and find you the best home (in your price range) in the neighborhood of your dreams. Let us connect you by clicking here.